Ask question

Ask question

All categories

4 years ago

9

Nielson Corp. sells its product for $6,600 per unit. Variable costs per unit are: manufacturing, $3,600, and selling and adminis

trative, $75. Fixed costs are: $18,000 manufacturing overhead, and $24,000 selling and administrative. There was no beginning inventory at 1/1/15. Production was 20 units per year in 2015–2017. Sales were 20 units in 2015, 16 units in 2016, and 24 units in 2017. Income under absorption costing for 2017 is
A) $4,800.

B) $8,400.

C) $9,600.

D) $13,200.

1 answer:

Anvisha [2.4K]4 years ago

6 0

Answer:

B) $8,400

Explanation:

Absorption costing consider all the cost incurred in production either variable or fixed as production cost.

As we know variable cost vary with the change in the sale but the fixed costs remains constant whatever the level of sale is.

As per given data

Selling price = $6,600

Variable manufacturing cost = $3,600

Manufacturing Fixed Cost = $18,000

Total cost per unit = $3,600 + $18,000/20 = $4,500

Sales = Selling price x Numbers of units sold = $6,600 x 16 = $105,600

Cost of goods sold = Units sold x Cost per unit = 16 units x $4,500 = $72,000

Gross income = Sales - Cost of Goods sold = $105,600 - $72,000 = $33,600

Selling and Admin Cost = Variable cost + Fixed = (16 x $75) + $24,000 = $25,200

Net Income = Gross Income - Selling and Admin cost = $33,600 - $25,200 = $8,400

You might be interested in

Economists define "programmed spending behavior" as being spending that is frequent and is done with relatively little thought.

Alexandra [31]

Answer: D) buying coffee in the morning

3 0

4 years ago

Read 2 more answers

After deciding to buy a new car, you can either lease the car or purchase it on a three-year loan. The car you wish to buy costs

elena55 [62]

Answer:

It would be better to buy the car.

Nominal 26,446.81 (break even resale price)

Explanation:

We solve the present value of the salvage value at 6% APR

$\frac{Maturity}{(1 + rate)^{time} } = PV$

Maturity $28,000.0000

time 36.00

rate 0.00500

$\frac{28000}{(1 + 0.005)^{36} } = PV$

PV 23,398.0577

Net present worth:

23,398.06 - 43,000 = 19,601.94

Lease option

PV of the monthly payment:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 505.00

time 36

rate 0.005

$505 \times \frac{1-(1+0.005)^{-36} }{0.005} = PV\\$

PV $16,599.8632

plus the 4,300 downpayment

present worth: -20.899,86‬

As the option from the purcahse gives a lower present worth it is preferable over the option to lease the vehicle

X - 43,000 = -20,899.86

X = 22,100.14

We have to look at which resale price the present value is equal to 22,100.14

$PV \: (1+ r)^{time} = Nominal$

Principal 22,100.14

time 36.00

rate 0.00500

$22100.14 \: (1+ 0.005)^{36} = Nominal$

Nominal 26,446.81

7 0

3 years ago

Katherine is developing a forecast for her company's next year's sales of an organic fertilizer to retail gardening nurseries. s

Furkat [3]

She is engaging in <u>Bottom-up</u> Forecasting.

<h3>What is Bottom-Up Forecasting?</h3>

Bottom-up forecasting is a high-level prediction of micro-level inputs to estimate revenue for a particular year or group of years. Revenue teams, for example, frequently utilize this strategy to forecast the company's future performance based on individual sales or rep performance.

Bottom-up forecasting is analogous to assessing the health of a complicated system, such as a vehicle, by examining its most fundamental components, such as its engine components.

The essential distinction between top-down and bottom-up methodologies is the perspective used to conduct your analysis. Bottom-up forecasting is excellent for assessing the impact of certain performance measures on revenue. However, in order to truly grasp the health of a complicated firm, we must examine it from several perspectives.

In a top-down study, we estimate aggregate demand. This style of evaluation considers past performance to forecast future performance.

Therefore, Katherine is developing a forecast for her company's next year's sales of organic fertilizer to retail gardening nurseries. she is assembling the sales estimates for her company's product by adding together the territory estimates provided by her salespeople. she is engaging in <u>Bottom-Up forecasting.</u>

For more information on Bottom-up Forecasting, refer to the given link:

brainly.com/question/14683037

#SPJ4

3 0

2 years ago

An ad for Bud Light ran six times during a recently televised football game. When measuring IMC results for this ad, six would b

Zepler [3.9K]

Answer: (A.) Frequency

Explanation:

8 0

3 years ago

"judith supervises a call center department that receives stress-producing calls from unhappy customers. turnover has increased

ICE Princess25 [194]

Judith is likely demonstrating the leadership style called affiliative. This leadership style tends to focus more on the people as a way of establishing or building relationships or to be able to communicate or understand the people associated with the certain task or problem.

7 0

4 years ago